They aim to guarantee food availability and thus increase confidence in markets
According to FAO, typical cereal requirement is "160-175 kg per person per year and that a lead time of three months would be required to organise and receive additional supplies"[2] . In Finland the target is defined from daily nutrition perspective[3] . The target of the National Emergency Supply Agency Finland is to ensure adequate daily nutrition of 2 800 Kcal daily[4] . The supply relies mainly on domestic agricultural production[5] . In Africa, around 70 percent of the studied countries had a food reserve system[6] .
Connection to food
Prices in agricultural commodity markets can have relatively volatile even if there would be no reason due to supply and demand reasons. The commodities are traded and futures and options are sold and thus market speculations affect prices even though supply and demand are in balance[7] . Food reserves are designed to compensate this volatility and guarantee reasonable prices[8] .
For example in 2008, when prices increased remarkably, some of the reasons were low inventory levels and poor harvests especially in Australia. Other remarkable factors were rapid economic growth, speculative influences and increased biofuel production.[9]
Connection to SDGs
Food reserves respond directly to the Zero Hunger target[10] , as the reserves aim to increase food system security by storing adequate stock in case of insufficient yields. They also help to decrease food price volatility so that people can affrod to buy food even if the world market prices happen to be high. Food reserves is an area where public-private partnerships can create mutually beneficial solutions according to SDG 17 (Revitalize the global partnership for sustainable development). The concept relates to SDG 12 (Ensure sustainable consumption and production patterns) as well: food reserves hve to be designed and maintained so that the food waste will be avoided.
Organizational illustrations around concept
China has one of the largest stocks of grains as it aims to be immune for all kinds of food crisis. Reserve stocks of corn and rice are close to 50-60 % of annual consumption while the recommendation of the UN is 17 % (in March 2015). China doesn't release exact numbers but analysts estimated that the grain reserves were close to 300 million tons at the end of 2015. It has been claimed that China imports grain just to stock it.[11]
Examples from Finland
National Emergency Supply Agency is responsible of arranging food and other reserves in Finland. Unlike in Switzerland, the emergency supply is mainly in raw materials. In Switzerland, the end storage is mainly in end products, such as cheese[12] . In 2015, the Finnish Government decided to decrrease the amount of reserve stocks to represent the needs of six months instead the previous target of the one year[13] .
^ Lynton-Evans, J. (1997). Strategic grain reserves - Guidelines for their establishment, management and operation. (FAO Agricultural Services Bulletin - 126). Rome: Food and Agriculture Organization of the United Nations
^ Braun, J. & Torero, M. (2012). Implementing physical and virtual food reserves to protect the poor and prevent market failure. In Grain Reserves and the Food Price Crisis: Selected Writings from 2008-2012. Minneapolis: Institute for Agriculture and Trade Policy
Food reserves are usually stocks of grains managed at the national, regional or international level. They serve several purposes[1] :
According to FAO, typical cereal requirement is "160-175 kg per person per year and that a lead time of three months would be required to organise and receive additional supplies"[2] . In Finland the target is defined from daily nutrition perspective[3] . The target of the National Emergency Supply Agency Finland is to ensure adequate daily nutrition of 2 800 Kcal daily[4] . The supply relies mainly on domestic agricultural production[5] . In Africa, around 70 percent of the studied countries had a food reserve system[6] .
Connection to food
Prices in agricultural commodity markets can have relatively volatile even if there would be no reason due to supply and demand reasons. The commodities are traded and futures and options are sold and thus market speculations affect prices even though supply and demand are in balance[7] . Food reserves are designed to compensate this volatility and guarantee reasonable prices[8] .
For example in 2008, when prices increased remarkably, some of the reasons were low inventory levels and poor harvests especially in Australia. Other remarkable factors were rapid economic growth, speculative influences and increased biofuel production.[9]
Connection to SDGs
Food reserves respond directly to the Zero Hunger target[10] , as the reserves aim to increase food system security by storing adequate stock in case of insufficient yields. They also help to decrease food price volatility so that people can affrod to buy food even if the world market prices happen to be high. Food reserves is an area where public-private partnerships can create mutually beneficial solutions according to SDG 17 (Revitalize the global partnership for sustainable development). The concept relates to SDG 12 (Ensure sustainable consumption and production patterns) as well: food reserves hve to be designed and maintained so that the food waste will be avoided.
Organizational illustrations around concept
China has one of the largest stocks of grains as it aims to be immune for all kinds of food crisis. Reserve stocks of corn and rice are close to 50-60 % of annual consumption while the recommendation of the UN is 17 % (in March 2015). China doesn't release exact numbers but analysts estimated that the grain reserves were close to 300 million tons at the end of 2015. It has been claimed that China imports grain just to stock it.[11]
Examples from Finland
National Emergency Supply Agency is responsible of arranging food and other reserves in Finland. Unlike in Switzerland, the emergency supply is mainly in raw materials. In Switzerland, the end storage is mainly in end products, such as cheese[12] . In 2015, the Finnish Government decided to decrrease the amount of reserve stocks to represent the needs of six months instead the previous target of the one year[13] .
External links
Open source articles
Quiz
Quiz created by Olli T with GoConqr
https://www.huoltovarmuuskeskus.fi/toimialat/elintarvikehuolto/toiminnan-perusteet/ (accessed 22.2.2017)
http://www.marketwatch.com/story/chinas-big-grain-reserves-come-with-equally-big-problems-2015-04-20> (accessed 13.4.2017)
http://www.hs.fi/talous/art-2000002742911.html (2.3.2014)